Federal Register / Vol. 75, No. 13 / Thursday, January 21, 2010 / Notices 3503 

1 15 U.S.C. 78o–7. 

2See Rule 17g–4. Release No. 34–55231 (Feb. 2, 

2007), 72 FR 6378 (Feb. 9, 2007); and Release No. 

34–55857 (June 5, 2007), 72 FR 33564 (June 18, 

2007). 3 50 hours × 30 NRSROs = 1,500 hours. 

defined in Sec. 105.50 of the 

regulations. 

Notice is hereby given that any 

interested person may submit written 

comments on the transaction, within 15 

days, to the Associate Administrator for 

Investment, U.S. Small Business 

Administration, 409 Third Street, SW., 

Washington, DC 20416. 

Sean J. Greene, 

Associate Administrator For Investment. 

[FR Doc. 2010–999 Filed 1–20–10; 8:45 am] 

BILLING CODE 8025–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Rule 17g–4; SEC File No. 270–566; OMB 

Control No. 3235–0627] 

Proposed Collection; Comment 

Request 

Upon Written Request, Copies Available 

From: U.S. Securities and Exchange 

Commission, Office of Investor 

Education and Advocacy, 

Washington, DC 20549–0213. 

Notice is hereby given that, pursuant 

to the Paperwork Reduction Act of 1995 

(44 U.S.C. 3501 et seq.), the Securities 

and Exchange Commission 

(‘‘Commission’’) is soliciting comments 

on the existing collection of information 

provided for in Rule 17g–4 (17 CFR 

240.17g–4) under the Securities 

Exchange Act of 1934 (15 U.S.C. 78a et 

seq.) (‘‘Exchange Act’’). 

The Rating Agency Act added a new 

Section 15E, ‘‘Registration of Nationally 

Recognized Statistical Rating 

Organizations,’’ 1 to the Exchange Act. 

Rule 17g–4 requires that a Nationally 

Recognized Statistical Rating 

Organization (‘‘NRSRO’’) has written 

policies and procedures to prevent the 

misuse of material nonpublic 

information including: procedures 

designed to prevent the inappropriate 

dissemination of material nonpublic 

information obtained in connection 

with the performance of credit rating 

services; procedures designed to prevent 

a person associated with the rating 

organization from trading on material 

nonpublic information; and procedures 

designed to prevent the inappropriate 

dissemination of a pending credit 

rating.2

It is anticipated that 30 credit rating 

agencies will register with the 

Commission as NRSROs under Section 

15E of the Exchange Act. The 

Commission estimates that it will take 

approximately 50 hours for an NRSRO 

to establish procedures in conformance 

with Rule 17g-4 for a total one-time 

burden for the 30 credit rating agencies 

the Commission estimates will register 

as NRSROs of 1,500 hours.3

Written comments are invited on: (a) 

Whether the collection of information is 

necessary for the proper performance of 

the functions of the agency, including 

whether the information will have 

practical utility; (b) the accuracy of the 

agency’s estimate of the burden of the 

collection of information; (c) ways to 

enhance the quality, utility, and clarity 

of the information collected; and (d) 

ways to minimize the burden of the 

collection of information on 

respondents, including through the use 

of automated collection techniques or 

other forms of information technology. 

Consideration will be given to 

comments and suggestions submitted in 

writing within 60 days of this 

publication. 

Comments should be directed to 

Charles Boucher, Director/Chief 

Information Officer, Securities and 

Exchange Commission, C/O Shirley 

Martinson, 6432 General Green Way, 

Alexandria, Virginia 22312 or send an 

e-mail to: PRA_Mailbox@sec.gov. 

Dated: January 13, 2010. 

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. 2010–1021 Filed 1–20–10; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

Proposed Collection; Comment 

Request 

Upon Written Request, Copies Available 

From: U.S. Securities and Exchange 

Commission, Office of Investor 

Education and Advocacy, 

Washington, DC 20549–0213. 

Extension: 

Rule 15c3–1f; SEC File No. 270–440; OMB 

Control No. 3235–0496. 

Notice is hereby given that, pursuant 

to the Paperwork Reduction Act of 1995 

(44 U.S.C. 3501 et seq.), the Securities 

and Exchange Commission 

(‘‘Commission’’) is soliciting comment 

on the existing collection of information 

provided for in the following rule: 

Appendix F to Rule 15c3–1 (‘‘Appendix 

F’’) (17 CFR 240.15c3–1f) under the 

Securities Exchange Act of 1934 (15 

U.S.C. 78a et seq.) (‘‘Exchange Act’’). 

Appendix F requires a broker-dealer 

choosing to register, upon Commission 

approval, as an OTC derivatives dealer 

to develop and maintain an internal risk 

management system based on Value-atRisk (‘‘VAR’’) models. Appendix F also 

requires the OTC derivatives dealer to 

notify Commission staff of the system 

and of certain other periodic 

information including when the VAR 

model deviates from the actual 

performance of the OTC derivatives 

dealer’s portfolio. It is anticipated that 

a total of five (5) broker-dealers will 

spend 1,000 hours per year complying 

with Appendix F. The total burden is 

estimated to be approximately 5,000 

hours. 

Written comments are invited on: (a) 

Whether the proposed collection of 

information is necessary for the proper 

performance of the functions of the 

agency, including whether the 

information will have practical utility; 

(b) the accuracy of the agency’s estimate 

of the burden of the collection of 

information; (c) ways to enhance the 

quality, utility, and clarity of the 

information collected; and (d) ways to 

minimize the burden of the collection of 

information on respondents, including 

through the use of automated collection 

techniques or other forms of information 

technology. Consideration will be given 

to comments and suggestions submitted 

in writing within 60 days of this 

publication. 

Comments should be directed to 

Charles Boucher, Director/Chief 

Information Officer, Securities and 

Exchange Commission, C/O Shirley 

Martinson, 6432 General Green Way, 

Alexandria, Virginia 22312 or send an 

e-mail to: PRA_Mailbox@sec.gov. 

Dated: January 13, 2010. 

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. 2010–1022 Filed 1–20–10; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–61342; File No. SR–BX– 

2009–088] 

Self-Regulatory Organizations; 

NASDAQ OMX BX, Inc.; Notice of Filing 

and Immediate Effectiveness of 

Proposed Rule Change Relating to the 

Fee Schedule of the Boston Options 

Exchange Facility 

January 13, 2010. 

Pursuant to Section 19(b)(1) of the 

Securities Exchange Act of 1934 


jlentini on DSKJ8SOYB1PROD with NOTICES
3504 Federal Register / Vol. 75, No. 13 / Thursday, January 21, 2010 / Notices 

1 15 U.S.C. 78s(b)(1). 

2 17 CFR 240.19b–4. 

3 15 U.S.C. 78s(b)(3)(A)(ii). 

4 17 CFR 240.19b–4(f)(2). 

5See Section 7 of the BOX Fee Schedule which 

sets forth any applicable ‘‘liquidity fees and credits.’’ 

6According to Section 1 of the BOX Fee Schedule 

a Public Customer is charged $0.15 per executed 

contract of an Improvement Order on its behalf in 

the PIP where that order is not submitted as a 

Customer PIP Order (‘‘CPO’’) whereby it is labeled 

as a ‘‘non-CPO.’’ There are no other trading fees for 

any other Public Customer Orders which may be 

executed on BOX, including CPOs and Public 

Customer orders on the Book, except for the charges 

and credits described in Section 7 of the BOX Fee 

Schedule. 

7The fees proposed herein for Market Makers 

vary from the fees proposed for Broker Dealers as 

the obligations for the two are different. For 

example, Market Makers must maintain active twosided markets in options classes to which they are 

assigned and also have certain restrictions regarding 

trading activity in classes outside of their 

assignment, both of which do not apply to Broker 

Dealers on BOX. 

8The current standard Market Maker fee is $0.20 

per contact. 

9The Exchange notes that prior to this proposal 

the fees and credits of Section 7 did not apply to 

transactions in SPY, QQQQ and IWM. Similarly, 

the reduction in fees discussed in this section 

(‘‘Reduction of Fees and Credits in Section 7’’) do 

not apply to transactions in SPY, QQQQ and IWM. 

(‘‘Act’’),1 and Rule 19b–4 thereunder,2

notice is hereby given that on December 

31, 2009, NASDAQ OMX BX, Inc. (the 

‘‘Exchange’’) filed with the Securities 

and Exchange Commission 

(‘‘Commission’’) the proposed rule 

change as described in Items I, II, and 

III below, which Items have been 

prepared by the self-regulatory 

organization. The Exchange filed the 

proposed rule change pursuant to 

Section 19(b)(3)(A)(ii) of the Act,3 and 

Rule 19b–4(f)(2) thereunder,4 which 

renders the proposal effective upon 

filing with the Commission. The 

Commission is publishing this notice to 

solicit comments on the proposed rule 

from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The Exchange proposes to amend the 

Fee Schedule of the Boston Options 

Exchange Group, LLC (‘‘BOX’’). The text 

of the proposed rule change is available 

from the principal office of the 

Exchange, at the Commission’s Public 

Reference Room, on the Exchange’s 

Internet Web site at http:// 

nasdaqomxbx.cchwallstreet.com/ 

NASDAQOMXBX/Filings/, and on the 

Commission’s Web site at http:// 

www.sec.gov. 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, the 

self-regulatory organization included 

statements concerning the purpose of, 

and basis for, the proposed rule change 

and discussed any comments it received 

on the proposed rule change. The text 

of these statements may be examined at 

the places specified in Item IV below. 

The self-regulatory organization has 

prepared summaries, set forth in 

Sections A, B, and C below, of the most 

significant aspects of such statements. 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The BOX Fee Schedule currently lists 

certain execution fees as ‘‘standard’’ 

trading fees, meaning that these 

execution fees are not dependent upon 

whether the transaction added or 

removed liquidity on BOX.5 These 

standard fees, specifically within 

Sections 2 and 3 of the BOX Fee 

Schedule, are applicable for Broker 

Dealer proprietary accounts and Market 

Maker accounts, respectively, and are 

currently set at $0.20 per contract 

executed.6 The Exchange proposes to 

make the following adjustments to 

standard trading fees: 

Broker Dealer Trading Fees 

Section 2 of the BOX Fee Schedule 

describes the current standard 

transaction fee applicable to Broker 

Dealer transactions which is currently 

set at $0.20. The Exchange proposes that 

the standard fee for Broker Dealer 

transactions in all options classes, 

excluding transactions in Standard & 

Poor’s Depositary Receipts® (‘‘SPY’’), 

Powershares® QQQ Trust Series 1 

(‘‘QQQQ’’) and iShares Russell 2000® 

Index Fund (‘‘IWM’’) and transactions in 

the Price Improvement Period (‘‘PIP’’), 

be set at $0.25 per contract. 

Market Maker Trading Fees: 

The Exchange proposes to amend 

Section 3 of the BOX Fee Schedule 

relating to transaction fees applicable to 

BOX Market Makers.7 Specifically, the 

Exchange proposes to adopt a per 

contract transaction fee that is based on 

the number of contracts a BOX Market 

Maker executes in a month, excluding 

transactions in SPY, QQQQ and IWM 

and transactions within the PIP, as 

follows: 8

Average daily volume (ADV) for 

Market Maker 

Per 

contract 

ADV of 150,001 contracts and 

greater ..................................... $0.13 

ADV of 100,001 contracts to 

150,000 contracts ................... 0.16 

ADV of 50,001 contracts to 

100,000 contracts ................... 0.18 

Average daily volume (ADV) for 

Market Maker 

Per 

contract 

ADV of 10,001 contracts to 

50,000 contracts ..................... 0.20 

ADV of 0 contracts to 10,000 

contracts .................................. 0.25 

This proposed tiered fee schedule is 

designed to incent BOX Market Makers 

to increase their quoting and trading 

activity on BOX. As a Market Maker’s 

monthly trading volume increases the 

per-contract fee that a Market Maker is 

charged for such executions is 

decreased. The Exchange proposes that 

the new tiered fees apply to all BOX 

Market Makers for transactions in all 

classes traded on BOX (excluding 

executions which occur in the PIP 

auction and executions in SPY, QQQQ, 

& IWM). The BOX Market Maker’s ADV 

will be calculated at the end of each 

trading month. All executions for that 

month will be charged the same percontract fee rate according to the 

respective ADV achieved by the Market 

Maker. 

Section 3(b) of the BOX Fee Schedule 

currently sets forth a volume discount 

that is applicable to the execution fees 

of BOX Market Makers. The volume 

discount currently is $0.03 and $0.05 

per contract upon the Market Maker 

achieving an ADV of 25,000 and 50,000 

contracts per month, respectively. The 

tiered fee schedule, as outlined above, 

will effectively apply the same goal as 

the Market Maker volume discount, 

which is to incent more quoting activity 

and trading volume by Market Makers 

on BOX. The Exchange therefore 

proposes to eliminate, in its entirety, the 

Market Maker volume discount of 

Section 3(b) of the BOX Fee Schedule. 

Reduction of Fees and Credits in 

Section 7 

The Exchange proposes to reduce the 

existing credits and fees within Section 

7 for both Non-Penny Pilot Classes and 

Penny Pilot Classes, from $0.75 to $0.55 

and from $0.20 to $0.15, respectively 

and for transactions in the PIP, from 

$0.20 to $0.15.9 These credits and fees 

apply equally to all account types, 

whether Public Customer, Firm or 

Market Maker and are in addition to any 

applicable trading fees, as described in 

Sections 1 through 3 of the BOX Fee 

Schedule. 

For example, a Public Customer Order 

in a Non-Penny Pilot Class is entered 


jlentini on DSKJ8SOYB1PROD with NOTICES
Federal Register / Vol. 75, No. 13 / Thursday, January 21, 2010 / Notices 3505 

10This example presupposes that the proposed 

increase in Broker Dealer fees, from $0.20 to $0.25, 

is in effect. 

11Currently the standard fees charged for 

transactions in SPY, QQQQ and IWM are $0.20 for 

both Market Maker and Broker Dealer transactions. 

As is currently the case, most executions on BOX 

on behalf of Public Customers will be free. 

12BOX Options Participants are able to compete 

within the PIP auction for a portion of the order on 

the opposite side of the Public Customer PIP Order 

that must be filled by submitting Improvement 

Orders. 

13Transactions within the PIP are presently 

subject to a $0.20 fee. This proposal merely breaks 

fees for PIP transactions into their own distinct line 

item in the Fee Schedule. See Ex. 5. Transactions 

within the PIP will also be subject to the fees and 

credits of Section 7 of the BOX Fee Schedule, as 

proposed and discussed above. 

14 15 U.S.C. 78f(b). 

15 15 U.S.C. 78f(b)(5). 

16 15 U.S.C. 78f(b). 

17 15 U.S.C. 78f(b)(4). 

18 15 U.S.C. 78s(b)(3)(A)(ii). 

19 17 CFR 240.19b–4(f)(2). 

into the BOX Trading Host and executes 

against a Broker Dealer’s order resting 

on the BOX Book. The Public Customer 

is the remover of liquidity and the 

Broker Dealer is the adder of liquidity. 

The Public Customer will receive a 

$0.55 ‘‘removal’’ credit and the Broker 

Dealer will be charged a $0.55 ‘‘add’’ 

fee. The Public Customer will receive a 

$0.55 total credit (zero charge from 

Section 1 plus the $0.55 ‘‘removal’’ 

credit) and the Broker Dealer will be 

charged $0.80 total (the $0.55 fee for 

adding liquidity in addition to the 

standard $0.25 transaction fee).10

Fees and Charges to SPY, QQQQ, and 

IWM 

The Exchange Traded Fund Shares 

(‘‘ETFs’’) SPY, QQQQ and IWM are 

among the most actively traded multiply 

listed options classes across all of the 

options exchanges. The Exchange 

believes that the characteristics that 

these ETFs share among themselves 

make it appropriate that pricing for 

transactions in these classes be set on 

par with each other. Furthermore, the 

Exchange believes that the volume and 

liquidity exhibited in these classes is 

such that the pricing applicable to these 

classes be set apart from the pricing 

applicable to all other options classes 

listed and traded on BOX. 

Therefore, the Exchange proposes that 

the standard fee for transactions in SPY, 

QQQQ and IWM be set at $0.10 per 

contract for Broker Dealers and at $0.05 

per contract for BOX Market Makers.11

The proposed different rate as between 

Broker Dealers and BOX Market Makers 

is based upon the obligations that 

Market Makers undertake on BOX, such 

as posting continuous two-sided quotes, 

which Broker Dealers are not subject to. 

The credits and fees of Section 7 of 

the BOX Fee Schedule currently do not 

apply to executions in the classes SPY, 

QQQQ or IWM. The Exchange proposes 

to apply Section 7’s credits and fees to 

transactions in these three classes as is 

currently applied to transactions in all 

other classes on BOX. The Exchange 

proposes that the fees and credits apply 

equally for these three classes at $0.05 

for both the fees and credits. 

Transactions in the PIP 

The BOX PIP is a mechanism by 

which BOX Participants can obtain 

executions and price improvement of 

their customers’ orders. Because 

executions in the PIP are separate and 

distinct from non-PIP executions the 

Exchange believes that pricing for 

executions that take place within the 

PIP also be separate and distinct from 

non-PIP execution rates.12 Therefore, 

the Exchange proposes that the standard 

fee for transactions within the PIP, 

including transactions in SPY, QQQQ 

and IWM, be set at $0.20 per contract, 

both for Broker Dealers and for BOX 

Market Makers.13

Non-Substantive Changes 

The Exchange is also proposing 

various non-substantive changes to the 

BOX Fee Schedule. These changes are 

necessary for reasons such as the 

elimination of certain Fee Schedule text 

(e.g. the proposed elimination of the 

Market Maker Volume Discount of 

Section 3(b)) or the renumbering of 

certain sections of the Fee Schedule (e.g. 

Section 2(b) renumbered to Section 

2(c)). Further non-substantive changes 

have been proposed either to add greater 

clarity or remove language from the Fee 

Schedule which is now considered 

confusing in light of the substantive 

changes that are being proposed herein. 

2. Statutory Basis 

The Exchange believes that the 

proposal is consistent with the 

requirements of Section 6(b) of the 

Act,14 in general, and Section 6(b)(5) of 

the Act,15 in particular, as well as 

Section 6(b) of the Act,16 in general, and 

Section 6(b)(4) of the Act,17 in particular 

in that it provides for the equitable 

allocation of reasonable dues, fees, and 

other charges among its members and 

issuers and other persons using its 

facilities. In particular, the proposed 

change will allow the fees charged on 

BOX to remain competitive with other 

exchanges as well as apply such fees in 

a manner which is equitable based upon 

the particular account type, e.g. Market 

Maker or Broker Dealer, for which such 

transactions are executed. The 

obligations of Market Makers on BOX 

and Brokers Dealers that execute 

transactions on BOX are different. For 

example, BOX Market Makers must 

maintain active two-sided markets in 

options classes to which they are 

assigned and also have certain 

restrictions regarding trading activity in 

classes outside of their assignment, both 

of which do not apply to Broker Dealers 

on BOX. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

The Exchange does not believe that 

the proposed rule change will impose 

any burden on competition that is not 

necessary or appropriate in furtherance 

of the purposes of the Act. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants or Others 

The Exchange has neither solicited 

nor received comments on the proposed 

rule change. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

The foregoing rule change has become 

effective pursuant to Section 

19(b)(3)(A)(ii) of the Exchange Act 18

and Rule 19b–4(f)(2) 19 thereunder, 

because it establishes or changes a due, 

fee, or other charge applicable only to a 

member. 

At any time within 60 days of the 

filing of the proposed rule change, the 

Commission may summarily abrogate 

the rule change if it appears to the 

Commission that the action is necessary 

or appropriate in the public interest, for 

the protection of investors, or would 

otherwise further the purposes of the 

Act. 

IV. Solicitation of Comments 

Interested persons are invited to 

submit written data, views, and 

arguments concerning the foregoing, 

including whether the proposed rule 

change is consistent with the Act. 

Comments may be submitted by any of 

the following methods: 

Electronic Comments: 

• Use the Commission’s Internet 

comment form (http://www.sec.gov/ 

rules/sro.shtml); or 

• Send an e-mail to rulecomments@sec.gov. Please include File 

Number SR–BX–2009–088 on the 

subject line. 

Paper Comments: 

• Send paper comments in triplicate 

to Elizabeth M. Murphy, Secretary, 


jlentini on DSKJ8SOYB1PROD with NOTICES
3506 Federal Register / Vol. 75, No. 13 / Thursday, January 21, 2010 / Notices 

20 17 CFR 200.30–3(a)(12). 

1 15 U.S.C. 78s(b)(1). 

2 15 U.S.C. 78a. 

3 17 CFR 240.19b–4. 

4See Securities Exchange Act Release No. 58037 

(June 26, 2008), 73 FR 38008 (July 2, 2008). 

5Under this formula, an opening transaction in a 

FLEX Equity series in a stock priced at $40 or more 

would reach the $1 million limit before it would 

reach the contract size limit, i.e., 250 contracts 

times the multiplier (100) times the stock price 

($40) equals $1 million in underlying value. For a 

FLEX Equity series in a stock priced at less than 

$40, the 250 contract size limit applies. 

6Under this proposed formula, an opening 

transaction in a FLEX Equity series in a stock priced 

at approximately $66.67 or more would reach the 

$1 million limit before it would reach the contract 

size limit, i.e., 150 contracts times the multiplier 

(100) times the stock price ($66.67) equals just over 

$1 million in underlying value. For a FLEX Equity 

series in a stock priced at less than $66.67, the 150 

contract size limit would apply. 

7The Commission notes that the Exchange has 

stated that it will provide the Commission with an 

updated report 45 days before any request to extend 

or make permanent the current pilot program 

regarding the minimum value size for opening a 

FLEX Equity Option transaction. See E-mail from 

Andrew Stevens, Chief Counsel, U.S. Equities and 

Derivatives, NYSE Amex, to Jennifer Colihan, 

Special Counsel, Division of Trading and Markets, 

Commission, dated January 13, 2010. 

Securities and Exchange Commission, 

100 F Street, NE., Washington DC 

20549–1090. 

All submissions should refer to File 

Number SR–BX–2009–088. This file 

number should be included on the 

subject line if e-mail is used. To help the 

Commission process and review your 

comments more efficiently, please use 

only one method. The Commission will 

post all comments on the Commission’s 

Internet Web site (http://www.sec.gov/ 

rules/sro.shtml). Copies of the 

submission, all subsequent 

amendments, all written statements 

with respect to the proposed rule 

change that are filed with the 

Commission, and all written 

communications relating to the 

proposed rule change between the 

Commission and any person, other than 

those that may be withheld from the 

public in accordance with the 

provisions of 5 U.S.C. 552, will be 

available for inspection and copying in 

the Commission’s Public Reference 

Room, 100 F Street, NE., Washington, 

DC 20549, on official business days 

between the hours of 10 a.m. and 3 p.m. 

Copies of such filing also will be 

available for inspection and copying at 

the principal office of the Exchange. All 

comments received will be posted 

without change; the Commission does 

not edit personal identifying 

information from submissions. You 

should submit only information that 

you wish to make available publicly. All 

submissions should refer to File No. 

SR–BX–2009–088 and should be 

submitted on or before February 11, 

2010. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.20

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. 2010–1015 Filed 1–20–10; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–61343; File No. SR– 

NYSEAmex–2009–94] 

Self-Regulatory Organizations; Notice 

of Filing and Immediate Effectiveness 

of Proposed Rule Change by NYSE 

Amex LLC Amending Commentary .01 

to Rule 903G 

January 13, 2010. 

Pursuant to Section 19(b)(1) 1 of the 

Securities Exchange Act of 1934 (the 

‘‘Act’’) 2 and Rule 19b–4 thereunder,3

notice is hereby given that, on December 

23, 2009, NYSE Amex LLC (‘‘NYSE 

Amex’’ or the ‘‘Exchange’’) filed with the 

Securities and Exchange Commission 

(the ‘‘Commission’’) the proposed rule 

change as described in Items I and II 

below, which Items have been prepared 

by the self-regulatory organization. The 

Commission is publishing this notice to 

solicit comments on the proposed rule 

change from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The Exchange proposes to amend 

Commentary .01 to Rule 903G in order 

to extend until August 31, 2010, the 

current pilot period regarding the 

minimum value size for opening a FLEX 

Equity Option transaction (‘‘Pilot 

Program’’). The text of the proposed rule 

change is attached as Exhibit 5 to the 

19b–4 form. A copy of this filing is 

available on the Exchange’s Web site at 

http://www.nyse.com, at the Exchange’s 

principal office and at the Commission’s 

Public Reference Room. 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, the 

self-regulatory organization included 

statements concerning the purpose of, 

and basis for, the proposed rule change 

and discussed any comments it received 

on the proposed rule change. The text 

of those statements may be examined at 

the places specified in Item IV below. 

The Exchange has prepared summaries, 

set forth in sections A, B, and C below, 

of the most significant parts of such 

statements. 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and the 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The Pilot Program provides for an 

initial series opening transaction size to 

be 150 contracts (or $1 million in 

underlying value, whichever is less).4

The Exchange believes that the 

proposed reduction of the minimum 

value size for opening a series provides 

FLEX participating members and their 

customers with greater flexibility in 

structuring the terms of FLEX Equity 

Options to better suit the FLEX traders’ 

particular needs. Prior to the initiation 

of the Pilot Program, the minimum 

opening transaction value size in the 

case of FLEX Equity Options series was 

the lesser of (i) 250 contracts or (ii) the 

number of contracts overlying $1 

million in the underlying series.5 The 

Pilot Program modifies the minimum 

opening size formula by reducing the 

‘‘250 contracts’’ component to ‘‘150 

contracts’’ (the $1 million underlying 

value component continues to apply 

unchanged).6

The Pilot Program expired on 

December 19, 2009. The purpose of this 

proposed rule change is to extend the 

pilot period that applies to the 

minimum value size for an opening Flex 

Equity Options transaction until August 

31, 2010. This is merely an extension. 

The Exchange is not seeking any other 

changes to the Pilot Program.7

In support of the proposed rule 

change, the Exchange is submitting to 

the commission [sic] a Pilot Program 

report (the ‘‘Report’’) detailing the 

Exchange’s experience with the Pilot 

Program. Specifically, the Report 

contains (i) data and analysis on the 

open interest and trading volume in 

FLEX Equity Options for which series 

were opened with a minimum opening 

size of 150 to 249 contracts with less 

than $1 million in underlying value; 

and (ii) analysis on the types of 

investors that initiated opening FLEX 

Equity Options transactions (i.e., 

institutional, high net worth or retail, if 

any). The Exchange is submitting the 

Report under separate cover and seeking 

confidential treatment under the 

Freedom of Information Act. 

The Exchange believes that 

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